Sports Direct has a new target: Game Digital

Sports Direct has a new target: Game Digital

Sports Direct has a new target: Game Digital

In the past Ashley has also used Sports Direct to buy up stakes in JD Sports, House of Fraser and most recently French Connection and Agent Provocateur.

Although perhaps surprising to some, investment banking, research, sales, and trading company Liberum told the BBC that there was some clear logic behind the shares purchase: "We see a number of reasons how Game and Sports Direct can gain from a closer working relationship but it is surely the similar customer demographics that must be the key draw card here".

Ashley, who owns 54% of Sports Direct, has barely been out of the headlines in the past week due to a legal spat that has seen him confess to be being a "power drinker" alongside reports of him throwing up in the fireplace at one meeting held in a pub. Shares in the company collapsed by 36% last month after a profit warning.

Game said in a stock market announcement that it had been informed that Sports Direct had bought 44 million shares, or a 25.75% stake in the group. This is equal to 25.75% of the struggling high street video games retailer. The profit warning, based on a number of factors, including a predicted shortage of Nintendo Switch consoles and a weak line-up of games.

Chief Executive Mike Ashley is now embroiled in a court battle with a former colleague, which saw the exposure of the company's operations and Mr Ashley's un-orthdox management style.

Shares in Game soared yesterday and rose a further 11% to 27.2p today.

The response to this profit warning was another drop in share price value to 20p, which is pretty bleak, considering that when GAME was actually floated on the stock market three years ago it was nearly 200p per share.

Given it's current predicament, GAME says it's pleased its "strategic value" has been recognised by Sports Direct.

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